I just purchased a multi family in RI and they have a law that requires me to file a non-resident landlord filing and assign a registered agent that is in state. Does anyone have any experience with this? I have a friend that also own a property in RI with a similar situation and pays her attorney to file and use his address as the registered agent. I searched online and found a website strictly for registered agents for $50/year. I'm leaning towards this route but would love feedback.
@Lisa Tam the non-resident landlord filing is different than having to register an out of state entity (like an LLC or corporation) to do business in RI. They're two separate, but obviously related, requirements.
Even an individual, who is not an entity but is an out-of-state owner, needs to register with the Secretary of State (RI Department of State) as a non-resident landlord.
You should also contact the building department, zoning, or town clerk for the city/town that the property is in, to make sure that the town itself doesn't have a separate nonresident (sometimes called "absentee") landlord registration requirement - some do (e.g., Pawtucket and Providence).
If you also have an out-of-state entity (e.g., a Massachusetts LLC) you should also register your entity to do business in RI, again with the RI Department of State, and you will also need a Resident Agent in RI on record there (it's part of the registration). An attorney often does that, but it could be a company providing those services, too.
So as an out of state owner, if you own the property with an out of state entity, I think you'd have three requirements: 1) register the foreign entity with the RI Secretary of State to do business in RI; 2) register as a nonresident landlord with the RI Secretary of State; 3) (possibly) also register as a nonresident/absentee landlord in the city/town that the property is in.
Lastly, be aware that anything on these registration forms could be publicly available. For example, I've found non-resident landlord filings in land evidence / title searches, with owners' cell phone numbers on them, and I've also found the same thing in the Secretary of State's online records.
These are legal questions, of course, and I'm not an attorney, you should really ask an attorney licensed to practice law in RI, etc. Since real estate is a legal-intensive business, if you own property in RI you will probably need a legal resource here sooner or later, so this question is a great reason to form such a relationship IMO, if you don't already have one.
I believe I have to file as an out of state landlord and at the same time designate an agent which can be a registered agent? Do you have any local registered agents that you can recommend?
I've always just used an attorney. If you have an existing relationship with them, their fees are usually pretty reasonable, though sometimes a busy attorney will basically say it's too much of a nuisance for them and they'll point you at a local company they recommend their clients use instead.
You can use a company, but you will probably find there are many, many hits that come up if you try to search online for RI resident agent or RI registered agent. If your attorney doesn't offer that service, or you only have a light/loose relationship with an attorney in RI, you could at least ask what company(ies) they recommend for the service.
If you have a friend or family member that you trust who lives in RI, you can use them as well. Or, if you're using a property management company based in RI, I believe you can use them - that's ideal actually since the information will be public record anyway, and they're already representing you at the property.
The main reason for the requirement, as I understand it (as a non-attorney), is for "service of process", i.e., someone must be resident in the state to receive a lawsuit if you're served with one.
So basically, it can be anyone who, if served with a lawsuit on your behalf, you can reasonably trust to notify you of that fact immediately. Immediately is important, because once a lawsuit starts you only have a certain number of days to respond.
99% of the time a resident agent just gets junk mail for you. But in the unlikely event you are sued, you want to make sure they understand the importance of notifying you immediately.
@Lisa Tam I use a registered agent company that I pay $50 a year for. I used to use a real estate agent who was the PM on the property but there is a requirement that the agent must be able to receive legal correspondence during regular business hours. And that PM company just wasn't keeping regular hours among other things. A registered agent service usually will post any communications in an online portal. I have received them this way with an email alert. The other thing I found is I don't have to change the address. I would not use friends or family. As @Anthony Thompson said a lawyer is also a good option.
Separate from this there are filings you need to do for an LLC if you form one. You must register, do an annual report, and pay an annual minimum $400 business tax also for a RI LLC.
@Colleen F. Thanks for the feedback, do you mind sharing which registered agent you use?
@Lisa Tam It is called Rhode Island registered agent. This one and many other registered agent services are part of a larger network but I have never had any problems. I just use them for communication I don't file my annual reports with them. Also the RI Secretary of State web site and business office has been helpful in the past with questions.